Let’s take a look at one of the current hottest projects in the crypto space. They even managed a top 10 position in rank for market cap. In November, their most outspoken co-founder, Sandeep Nailwal, already had something to say.
He won’t rest until they get their well-deserved top 3 spot next to BTC and ETH. Of course, we’re talking about Polygon and its MATIC token. And oh boy, did they recently deliver. The last couple of months, Polygon kept making headlines. It’s time to take a deep dive into Polygon. Let’s find out what makes them such a hot commodity.
Polygon’s Background
Polygon launched back in October 2017. The co-founders are Jaynti Kanani, Sandeep Nailwal, and Anurag Arjun. In 2019, they launched their own mainnet. Until that moment, they contributed a lot to the Ethereum network. To this day, you can use the same address for your Ethereum and Polygon account.
$50B+ in DEX volume on @0xPolygon over the last 12 months🤌 pic.twitter.com/ZSDnEvwcrj
— Narb (@NarbTrading) January 10, 2023
Polygon is a Layer 2 solution. They address Ethereum’s scalability problems. This means that they built on top of Ethereum. In other words, they are a side chain. They’re also EVM (Ethereum Virtual Machine) compatible. This means they can use Ethereum safety and security.
- Faster transaction speed: On an internal testnet, they managed to reach 10,000 TPS.
- Cheaper transactions: The fees are a fraction of a penny.
Some early projects that launched on Polygon are for example
- Aavegotchi: This digital collectibles game combines DeFi with NFTs.
- QuickSwap: A Uniswap fork, but with lower transaction fees.
So, now that you know a bit more about their background, let’s move on. It’s time to look into their Layer 2 technologies.
Polygon’s Technologies and Bridges
Polygon is a separate blockchain built on top of Ethereum. This in contrast to other L2 solutions like Arbitrum or Optimism. They offer devs of other projects, different options for their sidechains. For instance:
- Plasma chains: This technology bundles transactions into blocks. You can batch them now as a single submission to the main chain.
- Optimistic rollups: They are like plasma chains. However, they can also scale Ethereum smart contracts. This has a higher time-to-finality due to its “fraud-proofing” mechanism. OP and Arbitrum use this.
- ZK rollups: They bundle many transfers into one single transaction. It’s generally better than Optimistic roll-ups. The ZK tech is better, its development is slower.
1/ Polygon will lead the era of Modular blockchain in 2023.
I've written a '69 min read' long piece on @0xPolygon covering all of its products.
Hope this will serve as a valuable resource as you embark on your journey to Polygon💜
+ a thread 🧵https://t.co/Nt6mOYErJW
— 100y.eth🦇🔊💜 | a41 (@100y_eth) January 9, 2023
To make this work, Polygon acquired Hermez Network in August 2021. As a result, the two blockchains merged. That was the first time that such a merge between 2 chains took place. Furthermore, Polygon put $250 million in MATIC tokens on the table for this deal. With onboarding their technology, they can save space. A standard Ethereum transfer can take up to 100 bytes. On the other hand, Hermez only uses 10 bytes.
Polygon’s DAO and Bridges
Shortly after this acquisition, they formed a DAO. This should lead to further decentralization of Polygon. Other technologies Polygon works on are both still under construction. Here are some developments:
- Nightfall: A rollup that focuses on privacy for enterprises. It combines Optimistic roll ups with ZK roll up cryptography.
- Miden: A generzal purpose ZK, based on Stark ZK technology.
Polygon also has two bridges. They’re slower, but they’re also safe and dependable. They have:
- POS bridge: This supports ETH and other common ERC tokens. For instance, ERC 20, ERC 721, and ERC 1155. Deposits are almost instantly. However, withdrawals may take a bit longer, up to 3 hours.
- Plasma bridge: This bridge takes advantage of the Ethereum plasma scaling solution. You can transfer MATIC, ETH, ERC20 tokens, and ERC 721 tokens. This bridge has better transfer security. On the other hand, withdrawals take 7 days.
Did you ever use one of the Polygon bridges and if so, how did you like them? Now, let’s have a look at how Polygon has all these Web 2 partnerships.
Polygon’s Web 2 Partnerships
In recent weeks and months, Polygon was all the time in the news. Also on our YouTube channel. Most of this was due because of their partnerships with Web 2 companies. They’re looking to get a foothold in Web3, and they chose Polygon as their platform. These are some top-tier names that everybody is familiar with. Most of them look for NFT marketplace. For example:
- Stripe
- Walt Disney
- Adidas
- NFL
- Starbucks
- Adobe
- Meta
📢ANNOUNCED AT CES📢
@Mastercard will launch the Mastercard Artist Accelerator #onPolygon👉🏾a Web3-based, fan-driven initiative to develop and launch emerging musical artists in the digital economy 🎵 💳https://t.co/oEK7g29XyH pic.twitter.com/D5kRZRtPU4
— Polygon – MATIC 💜 (@0xPolygon) January 6, 2023
They also formed a partnership with the Swiss city of Lugano. They did this together with Thether, known from the USDT. Lugano aims to become the blockchain capital of Europe. They introduced their own stablecoin, the LGVA. You can use BTC, USDT, or LVGA to pay for public services like:
- Annual taxes.
- Parking tickets.
- Public services.
- Student tuition fees.
The LGVA runs on Polygon. So, you can see that their partnerships are just an amazing list of who’s who of big brand names. Have you been following these developments on Polygon? What do you make out of them? And we look into games and NFTs on Polygon.
Games, NFTs, and the Metaverse
For this section, Polygon has a dedicated division. Polygon studios. This may well become one of the biggest divisions within Polygon. They are already active in the gaming sector. According to DappRadar, they are supporting projects like:
- HunnyPlay for gambling.
- Planet IX.
- BenjiBananas.
- Arc8 by Gamee.
They are attracting quite a few games to their chain. It’s like what Avalanche is doing now as well. Their NFTs are slowly gaining traction as well. For instance:
- Trump released his Trump Cards collection on Polygon. This netted him $4.45 million.
- The Sandbox metaverse is on Polygon.
- So is Galxe.
- Or how about Lens Protocol. I see big potential for this protocol as a social network.
However, the biggest fish they pulled out of the river is the y00ts collection. They will move from Solana to Polygon in the next couple of months. Y00ts owner Frank, is netting a cool $3 million in grants for this transfer.
👉🏾 y00ts found a new home #onPolygon https://t.co/ulSTIVpvFd
— Polygon – MATIC 💜 (@0xPolygon) December 26, 2022
Still, currently, their NFTs don’t have a lot of traction. Trading volume is still low. Y00ts may change this. In the meantime, the Y00ts floor price increased. It peaked from 150 to 190 SOL. Now it’s back at 154 SOL.
MATIC Price Outlook
MATIC recently entered the top 10 of tokens by market cap. The current price is around $0.8818, but this is a token to keep an eye out. The market cap is already $7.934 billion. However, from the 10 billion max and total supply, already 9 billion circulate. MATIC is a token that I keep an eye out on!
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